Confido, an ICO startup has escaped with $374.000

The company founded to bring a new decentralized trustless payment solution for online shopping, which raised $374,477 in an ICO, has vanished
21 November 2017   1078

Confido has suddenly closed down its website and social media accounts of Twitter, Youtube, Reddit, Medium. Coincidentally, yesterday Confido suffered a 90-percent drop in value after informing investors a legal issue will halt development of the project indefinitely.

According to a whitepaper of Confido.io - Confido is a payment solution developed to be used by both businesses and individuals. It provides secure escrow payments using smart contracts, without relying on a third party to control the money. The unique thing about Confido is its shipment tracking feature. Confido will track a package up to the point that it gets delivered, and will only then release the funds. This is all done in a decentralised and automated fashion using smart contracts.

The company raised $374,477, being on highest rates on November 14 and suffered significant decline on November 19.

Confido v.3. 2017Confido (CFD) Charts

After the disappearance of the company, a large number of investors lost their investments. Many forums users wrote about their despair linked with the loss of savings, not believing in their failure.

The Confido scam comes the same day a survey showed that 15% of institutional traders won’t deal with ICOs until tighter regulation arrives. While the extensive majority of ICOs are conducted in good faith, a few bad examples can ruin everything.

ICOs May Allocate $24B Tokens to Themself

As reported, price of tokens, "left to cover the operating costs", reached $80B at the peak
17 January 2019   145

The total cost of the tokens that the organizers of well-known ICO projects have left to cover the operating costs and remuneration of developers at the time of release was $ 24.2 billion. At the peak, their price reached almost $ 80 billion. This is evidenced by the results of a study conducted by BitMEX together with the TokenAnalyst.

At the current illiquid rate, the assets of ICO-projects in their own tokens amount to about $ 5 billion, having depreciated by more than $ 70 billion.

However, the researchers note, this value is rather arbitrary, since the liquidity of tokens at peak levels was low. It is also incorrect to classify changes of this amount as losses because the organizers of the ICO transferred tokens into their wallets in accordance with the crowdsale conditions.

Having studied the archive of token transfers from ICO-team wallets, BitMEX and TokenAnalyst came to the conclusion that the realized profit from the sale of such tokens could be $ 1.5 billion, with the proviso that some of the tokens might not have been sold or left the wallets for other reasons .

The largest amounts of tokens in their wallets were credited by the Veritaseum and Noah project teams, which, as analysts say, looks “almost comical” against the background of real trading volumes.

Token data up to Dec 2018, data based on prices at the time(s) of issuance
Token data up to Dec 2018, data based on prices at the time(s) of issuance

This analysis highlights the lack of standards and transparency in the ICO market, especially when it comes to the allocation of tokens to the founding team’s wallet. Teams were often able to mint, burn, buy, and sell (their own) tokens at will, without analysts being able to easily track what is occurring. We would often see tokens in exchange clusters, and it was hard to tell whether the token project “paid” the exchange to list tokens or the token project just transferred their treasury to the exchange to cash out.
 

BitMEX Researchers' Report

In November 2018, BitMEX CEO Arthur Hayes said that the tokens of the largest ICO projects would collapse after entering the secondary market.